46 CFR 390 Capital Construction Fund

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SUBCHAPTER K—REGULATIONS UNDER PUBLIC LAW 91–469
PART 390—CAPITAL
CONSTRUCTION FUND
Sec.
390.1 Scope of the regulations.
390.2 Application for an agreement.
390.3 Policy considerations.
390.4 Description of the agreement.
390.5 Agreement vessels.
390.6 Administration of the agreement.
390.7 Deposits into the fund.
390.8 Investment of the fund.
390.9 Qualified withdrawals.
390.10 Nonqualified withdrawals.
390.11 Sale or other disposition of agreement vessels.
390.12 Liquidated damages.
390.13 Failure to fulfill a substantial obligation under the agreement.
390.14 Departmental reports and certification.
APPENDIX I TO PART 390—U.S. DEPARTMENT
OF TRANSPORTATION, MARITIME ADMINISTRATION—APPLICATION INSTRUCTIONS
APPENDIX II TO PART 390—SAMPLE CAPITAL
CONSTRUCTION FUND AGREEMENT
APPENDIX III TO PART 390—U.S. DEPARTMENT
OF TRANSPORTATION, MARITIME ADMINISTRATION—SAMPLE SEMIANNUAL REPORT
APPENDIX IV TO PART 390—SAMPLE ADDENDUM TO MARITIME ADMINISTRATION CAPITAL CONSTRUCTION FUND AGREEMENT
APPENDIX V TO PART 390—SAMPLE QUALIFIED
TRADE AFFIDAVIT
AUTHORITY: Secs. 53501, et seq., of Title 46,
United States Code, formerly, sec. 607, Merchant Marine Act, 1936, as amended (46 App.
U.S.C. 1177); 49 CFR 1.66.

eHill on DSK6VXHR33PROD with CFR

SOURCE: 41 FR 4265, Jan. 29, 1976, unless
otherwise noted.

§ 390.1 Scope of the regulations.
(a) In general—(1) Scope. The regulations prescribed in this part govern the
capital construction fund (‘‘fund’’) authorized by 46 U.S.C. 53501 et seq.
(2) Establishment of a fund. A fund is
established by an agreement (‘‘agreement’’), which is a contract between
the party (‘‘party’’) and the United
States.
(3) Purpose of the fund. Chapter 535
provides that any agreement entered
into with the Secretary of Transportation must be for the purpose of providing replacement vessels, additional
vessels or reconstructed vessels to be
built and documented in the United
States and operated in the United

States foreign, Great Lakes or noncontiguous domestic trade.
(4) Benefits of a fund. Chapter 535 provides for the nontaxability of certain
deposits of money or other property
placed into a fund established pursuant
to an agreement within certain ceilings. These ceilings are equal to:
(i) Earnings or gains realized from
the operation of an agreement vessel;
(ii) Net proceeds realized from the
sale or other disposition of an agreement vessel or from insurance or indemnification from the loss of an
agreement vessel; and
(iii) Earnings from the investment or
reinvestment of amounts on deposit in
the fund.
(5) Delegation. The Secretary of
Transportation has delegated the authority for matters relating to the
United States Merchant Marine to the
Maritime Administrator, Department
of Transportation (‘‘Maritime Administrator’’).
(b) Act. For purposes of this part, the
term Act shall mean Chapter 535 of
Title 46, United States Code.
(c) Joint regulations. For purposes of
this part, the term joint regulations
shall mean the regulations prescribed
by the Secretary of Transportation and
the Secretary of the Treasury under
Chapter 535 and published in title 26,
part 3 of the Code of Federal Regulations (reprinted in part 391 of this
chapter).
(d) Cross references. For rules relating
to the Federal Income Tax aspects of a
fund, see the joint regulations. For
rules governing agreements relating to
the fisheries of the United States, see
the separate Secretary of Commerce
regulations published in title 50, part
259 of the Code of Federal Regulations.
[41 FR 4265, Jan. 29, 1976, as amended at 73
FR 56740, Sept. 30, 2008]

§ 390.2

Application for an agreement.

(a) In general—(1) Application instructions. The Maritime Administrator has
adopted instructions for making application for an agreement. These instructions are contained in appendix I to

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